货币银行学练习.ppt

1、CH1,1)Financial markets and institutions A) involve the movement of huge flows of money. B) affect the profits of businesses. C) affect the types of goods and services produced in an economy. D) do each of the above. E) do only (a) and (b) of the above.,24)Compared to fifty years ago, A) small saver

2、s have more options for what they can do with their savings. B) small savers have fewer options for what they can do with their savings. C) small savers are likely to put their savings in a savings account at a commercial bank. D) small savers are likely to put their savings in a savings account at

3、a savings and loan.,26)Markets in which funds are transferred from those who have excess funds available to those who have a shortage of available funds are called A) commodity markets. B) fund-available markets. C) derivative exchange markets. D) financial markets.,27)The bond markets are important

4、 because A) they are easily the most widely followed financial markets in the United States. B) they are the markets where foreign exchange rates are determined. C) they are the markets where interest rates are determined. D) of each of the above. E) of only (a) and (b) of the above.,29)The stock ma

5、rket is important because A) it is where interest rates are determined. B) it is the most widely followed financial market in the United States. C) it is where foreign exchange rates are determined. D) all of the above.,31)Budgets deficits can be a concern because they might A) ultimately lead to hi

6、gher inflation. B) lead to a higher rate of money growth. C) lead to higher interest rates. D) cause all of the above to occur.,33)The price of one countrys currency in terms of anothers is called the exchange rate. B) the interest rate. C) the Dow Jones industrial average. D) none of the above.,34)

7、Everything else constant, a stronger dollar will mean that A) vacationing in England becomes more expensive. B) vacationing in England becomes less expensive. C) French cheese becomes more expensive. D) Japanese cars become more expensive.,45)Banks, savings and loan associations, mutual savings bank

8、s, and credit unions A) link those who want to save with these who want to invest. B) play an important role in determining the quantity of money in the economy. C) have been adept at innovating in response to changes in the regulatory environment. D) all of the above. E) only (a) and (c) of the abo

9、ve.,51)Compared to interest rates on long-term U.S. government bonds, interest rates on _ fluctuate more and are lower on average. A) medium-quality corporate bonds B) low-quality corporate bonds C) high-quality corporate bonds D) three-month Treasury bills E) none of the above,62)A rising stock mar

10、ket index due to higher share prices A) increases peoples wealth and as a result may increase their willingness to spend. B) increases the amount of funds that business firms can raise by selling newly-issued stock. C) decreases the amount of funds that business firms can raise by selling newly-issu

11、ed stock. D) both (a) and (b) of the above.,75)From 1980 to early 1985 the dollar _ in value, thereby, benefiting American _. appreciated; consumers appreciated, businesses C) depreciated; consumers D) depreciated, businesses,CH2,10)Which of the following can be described as involving direct finance

12、? A) A corporation issues new shares of stock. B) A corporation buys commercial paper issued by another corporation. C) A pension fund manager buys commercial paper from the issuing corporation. D) All of the above. E) Both (b) and (c) of the above.,24)Which of the following are long-term financial

13、instruments? A) A negotiable certificate of deposit B) A bankers acceptance C) A U.S. Treasury bond D) A U.S. Treasury bill,28)Which of the following are intermediate-term financial instruments? A) A bankers acceptance B) A share of Walt Disney Corporation stock C) A Treasury note with a maturity of

14、 four years D) Each of the above,37)Which of the following instruments is not traded in a money market? A) Bankers acceptances B) U.S. Treasury Bills C) Eurodollars D) Commercial paper E) Residential mortgages,39)Which of the following instruments are traded in a money market? Bank commercial loans

15、B) Bankers acceptances C) State and local government bonds D) Residential mortgages.,65)Federal funds are A) funds raised by the federal government in the bond market. B) loans made by the Federal Reserve System to banks. C) loans made by banks to the Federal Reserve System. D) loans made by banks t

16、o each other. E) none of the above.,77)Which of the following statements about financial markets and securities are true? A) A bond is a debt security that promises to make payments for a specified period of time. B) The maturity of a debt instrument is the time (term) to that instruments expiration

17、 date. C) A debt instrument is short term if its maturity is less than one year. D) All of the above are true.,82)An important financial institution that assists in the initial sale of securities in the primary market is the investment bank. B) commercial bank. C) stock exchange. D) brokerage house.

18、,89)U.S. Treasury bills are issued in A) three-, six-, nine-, and twelve-month maturities. B) three-, nine-, and twelve-month maturities. C) three-, six-, and twelve-month maturities. D) three-, and six-month maturities.,92)U.S. Treasury bills A) are the safest of all money market instruments. B) se

19、ll at a discount because they have no interest payments. C) are the most liquid of the money market securities. D) are all of the above. E) are only (b) and (c) of the above.,95)In the United States loans from _ are far _ important for corporate finance than are securities markets. government agenci

20、es; more B) government agencies; less C) financial intermediaries; more D) financial intermediaries; less,97)The countries that have made the least use of securities markets are Germany and Japan; in these two countries finance from financial intermediaries has been almost _ times greater than that

21、from securities markets. A) three B) four C) five D) ten,99)Studies of the major developed countries show that when businesses go looking for funds to finance their activities they usually obtain these funds from government agencies. B) equities markets. C) financial intermediaries. D) bond markets.

22、,101)American businesses get their external funds primarily from bank loans. B) bonds and commercial paper issues. C) stock issues. D) other loans.,110)In financial markets, lenders typically have inferior information about potential returns and risks associated with any investment project. This dif

23、ference in information is called A) comparative informational disadvantage. B) asymmetric information. C) variant information. D) caveat venditor.,11)Which of the following can be described as involving indirect finance? A) You make a loan to your neighbor. B) A corporation buys a share of common st

24、ock issued by another corporation. C) You buy a U.S. Treasury bill from the U.S. Treasury. D) You make a deposit at a bank.,20)Which of the following can be described as involving indirect finance? A) You make a loan to your neighbor. B) You buy a U.S. Treasury bill from the bank. C) You buy a U.S.

25、Treasury bill from the U.S. Treasury. D) A corporation buys commercial paper issued by another corporation.,43)Financial intermediaries A) exist because there are substantial information and transactions costs in the economy. B) improve the lot of the small saver. C) are involved in the process of i

26、ndirect finance. D) do each of the above. E) do only (a) and (b) of the above.,44)Which of the following financial intermediaries is not a depository institution? A) A savings and loan association B) A commercial bank C) A credit union D) A finance company E) None of the above,45)Which of the follow

27、ing is a contractual savings institution? A life insurance company A credit union C) A savings and loan association D) A mutual fund,46)Which of the following are not contractual savings institutions? A) Life insurance companies B) Credit unions C) Pension funds D) State and local government retirem

28、ent funds,52)Which of the following are depository institutions? A) Mutual savings banks B) Credit unions C) Mutual funds D) All of the above E) Only (a) and (b) of the above,55)Which of the following are investment intermediaries? A) Finance companies B) Mutual funds C) Pension funds D) All of the

29、above. E) Only (a) and (b) of the above,56)The primary assets of a pension fund are money market instruments. corporate bonds and stock. C) consumer and business loans. D) mortgages.,57)The primary assets of a savings and loan association are A) money market instruments. B) corporate bonds and stock

30、. C) consumer and business loans. D) mortgages.,58)The primary assets of credit unions are A) municipal bonds. B) business loans. C) consumer loans. D) mortgages.,59)The primary assets of a finance company are municipal bonds. B) corporate stocks and bonds. C) consumer and business loans. D) mortgag

31、es.,60)The primary assets of commercial banks include A) mortgages. B) consumer and business loans. C) U.S. government securities. D) all of the above. E) Only (a) and (b) of the above,62)The primary liabilities of fire and casualty insurance companies include commercial paper, stocks, and bonds. B)

32、 premiums from policies. C) savings deposits. D) all of the above.,63)The primary liabilities of a commercial bank are bonds. B) mortgages. C) deposits. D) commercial paper.,64)A situation in which a party issuing a debt instrument is unable to make its interest payments is called a A) failure. B) i

33、nsolvency. C) devaluation. D) default.,29)A borrower who takes out a loan usually has better information about the potential returns and risk of the investment projects he plans to undertake than does the lender. This inequality of information is called moral hazard. B) asymmetric information. C) no

34、ncollateralized risk. D) adverse selection.,33)Adverse selection is a problem associated with equity and debt contracts arising from A) the lenders relative lack of information about the borrowers potential returns and risks of his investment activities. B) the lenders inability to legally require s

35、ufficient collateral to cover a 100% loss if the borrower defaults. C) the borrowers lack of incentive to seek a loan for highly risky investments. D) none of the above.,36)Because of the adverse selection problem, A) lenders may choose to lend only to those who do not need the money. B) lenders typ

36、ically require collateral before making a loan. C) lenders may refuse loans to individuals with low net worth. D) all of the above.,37)Because of the moral hazard problem, A) lenders may demand positions on the board of directors of the firms that they provide with financing. B) lenders will choose

37、to write complicated contracts, prohibiting the borrowers from using the loan proceeds for unauthorized purposes. C) lenders will more readily lend to borrowers with high net worth. D) all of the above.,91)Moral hazard in equity contracts is known as the _ problem because the manager of the firm may

38、 shirk his responsibility to maximize profits for the shareholders. adverse selection B) free-rider C) principal-agent D) debt deflation,94)Which of the following is not one of the eight basic puzzles about financial structure? A) Stocks are the most important source of finance for American business

39、es. B) Issuing marketable securities is not the primary way businesses finance their operations. C) Indirect finance, which involves the activities of financial intermediaries, is many times more important than direct finance, in which businesses raise funds directly from lenders in financial market

40、s. D) Banks are the most important source of external funds to finance businesses.,100)Which of the following are true statements concerning financial structure in the United States? A) Issuing marketable securities is not the primary way businesses finance their operations. B) Bonds are a far more

41、important source of finance than are stocks in the United States. C) Together, bonds and stocks supply less than one-third of the external funds that corporations use to finance their activities. D) All of the above are true statements.,109)Because information is scarce, A) helps explain why debt co

42、ntracts are used so much more frequently to raise capital than are equity contracts. B) monitoring managers gives rise to costly state verification. C) government regulations, such as standard accounting principles, can help reduce moral hazard. D) all of the above are true. E) only (a) and (b) of t

43、he above are true.,CH3,2)The difference between money and income is that A) money is a flow and income is a stock. B) money is a stock and income is a flow. C) there is no difference-money and income are both stocks. D) there is no difference-money and income are both flows.,3)Currency includes A) p

44、aper money and coins. B) paper money, coins, and checks. C) paper money and checks. D) paper money, coins, checks, and savings deposits.,4)The conversion of a barter economy to one that uses money increases efficiency by reducing A) the need to exchange goods. B) the need to specialize. C) the need

45、to employ team production methods. D) transactions costs.,12)Today, most money in the United States is in the form of A) currency. B) currency and coins. C) checkable deposits. D) savings bonds.,13)When economists say that money promotes efficiency, they mean that money A) reduces transactions costs

46、. B) encourages specialization and the division of labor. C) is inexpensive to produce. D) does both (a) and (b) of the above.,15)Some of the forms money has taken throughout history include tobacco. cigarettes. stone wheels. all of the above.,20)If the price level doubles, the value of money A) dou

47、bles. B) more than doubles, due to scale economies. C) rises but does not double, due to diminishing returns. D) falls by 50 percent.,21)During hyperinflations, A) the value of money rises rapidly. B) money no longer functions as a good store of value and people may resort to barter transactions on

48、a much larger scale. C) middle-class savers benefit as prices rise. D) all of the above occur.,30)Although it can have a number of characteristics and serves more than one role, money must be backed in gold. have a nonmonetary value. C) be generally acceptable. D) be inexpensive to produce.,33)The n

49、arrowest measure of money that the Fed reports is A) M0. B) M1. C) M2. D) M3.,34)Which of the following is not included in the measure of M1? NOW accounts demand deposits C) currency D) repurchase agreements,36)Which of the following is included in M2 but not in M1? A) NOW accounts B) Demand deposit

50、s C) Currency D) Money market mutual fund shares (noninstitutional) E) gold coins issued by the U.S. Treasury,43)Money is A) anything that is generally accepted in payment for goods and services or in the repayment of debt. B) frequently-but incorrectly-used synonymously with wealth. C) currency, de

51、mand deposits, and other items used to make purchases. D) all of the above. E) only (a) and (c) of the above.,49)For a commodity to function effectively as money it must be A) easily standardized, making it easy to ascertain its value. B) widely accepted. C) divisible into relatively small units. D)

52、 all of the above. E) only (a) and (b) of the above.,59)Which of the following is not included in the M1 measure of money but is included in the M2 measure of money? savings deposits demand deposits C) travelers checks D) other checkable deposits,73)When prices in a particular country rise extremely

53、 rapidly, the country suffers A) deflation. B) disinflation. C) hyperinflation. D) all of the above.,82)If there are five goods in a barter economy, one needs to know ten prices in order to exchange one good for another. If, however, there are ten goods in a barter economy, then one needs to know _

54、prices in order to exchange one good for another. A) 20 B) 25 C) 30 D) 45,86)If there are five goods in a barter economy, one needs to know ten prices in order to exchange one good for another. If, however, there are six goods in a barter economy, then one needs to know _ prices in order to exchange

55、 one good for another. A) 6 B) 9 C) 12 D) 15,92)Because it is a medium of exchange, money A) discourages specialization and the division of labor. B) reduces transaction costs. C) is not allowed to earn interest. D) does only (b) and (c) of the above.,102)When people say, Bill Gates sure is rich, he

56、 has a lot of money. they probably mean that Bill Gates A) has a large checking account balance. B) is quite wealthy. C) has a relatively high income. D) all of the above. E) only (a) and (b) of the above.,107)Compared to an economy that uses a medium of exchange, in a barter economy transaction cos

57、ts are higher. transaction costs are lower. C) liquidity costs are higher. D) liquidity costs are lower.,116)In a barter economy the number of prices in an economy with N goods is N(N-1)/2. N(N/2). 2N. N(N/2)-1.,121)If an individual moves money from a demand deposit account to a money market deposit

58、 account, A) M1 decreases and M2 stays the same. B) M1 stays the same and M2 increases. C) M1 stays the same and M2 stays the same. D) M1 increases and M2 decreases.,126)If an individual moves money from currency to a money market deposit account, A) M1 decreases and M2 stays the same. B) M1 stays t

59、he same and M2 increases. C) M1 stays the same and M2 stays the same. D) M1 increases and M2 decreases.,CH4,1)A loan that requires the borrower to make the same payment every period until the maturity date is called a A) simple loan. B) fixed-payment loan. C) discount loan. D) a same-payment loan. E) none of the above.,2)A coupon bond pays the owner of the bond A) the same amount every month until maturity date. B) the face value of the bond plus an interest payment once the matu